While some buyers and sellers are sitting on the sidelines waiting to see how the pandemic evolves, other astute business owners are enjoying the benefits of a very positive environment for business sales in 2021.
1. Interest Rates are Low
With interest rates at an all-time low, 2021 is a great time to consider buying a business if you need to access finance.
Your net profit will be healthier if your interest repayments are lower, and that means more money to either pay yourself or improve your new business.
Alternatively, if you’re a business owner and thinking of selling, you may find there are more buyers in the market due to the cheaper finance options available to purchasers.
2. Property Prices are Rising
Real estate is back in favour after an anticipated decline in property prices due to COVID-19: during March, CoreLogic registered the biggest monthly growth in Australian property prices since October 1988.
If your house or commercial property has increased in value, consider talking to a mortgage broker to find out if you have spare equity in your home loan that can be used to buy your dream business.
3. Business Confidence is Increasing & Buyer Enquiry is Strong
With NAB’s monthly business survey indicating business confidence has risen to its highest level since early 2010, and strong interest in supporting local business in a pandemic-affected global economy, it’s a great time to own a business in Australia.
Brokers are noticing a sharp upturn in sales activity following a subdued business sales environment in 2020, so 2021 is an ideal time to put your business on the market due to the higher levels of buyer enquiry for quality listings.
4. Baby Boomers are Retiring
Thanks to the baby boom of the 1950’s, 126,000 more Australians will join the 65+ age group in 2021 and this number will continue to increase over the next few years, peaking at 137,000 new ‘retirees’ in 2026.
Many of this growing group of people over 65 years also own successful businesses and are seeking to sell them to pursue lifestyle interests. This is giving the younger generations an opportunity to purchase an established business with an existing client base, revenue, and potential for growth. Therefore making 2021 an ideal time to consider becoming a business owner.
5. Change Brings Opportunities
COVID-19 has reminded us that the only constant in life is change, and this is also true for business owners, however, change also brings opportunity for buyers.
Many business have had their best year ever due to a renewed focus on buying local and restrained international travel, and online businesses are not the only sector to thrive in a post-pandemic world.
Other businesses performing well in 2021 include:
- Home Services for the “Work from Home” brigade – renovation supplies, building trades, landscaping, home delivery services, office furniture & IT equipment
- Essential services – health, professional services (legal, accounting), aged care, childcare, education, cleaning, irrigation
- Real estate – property sales, home styling, decluttering
- Local tourism – accommodation, outdoor activities
- Pet services – dog grooming, pet accessories
- Sustainability manufacturing and associated retail – recycled goods, solar energy
- Food services – supermarkets, takeaway food outlets
- Manufacturing – quality Australian made goods